InvestmentsMay 17 2013

Cazenove shareholders back Schroders buyout

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Schroders has received the green light for its proposed £424m purchase of Cazenove Capital following a shareholder vote this afternoon.

Cazenove shareholders voted overwhelmingly in favour of the terms of the deal, paving the way for talks to begin as to how the businesses will be combined.

Although the focus of the deal is the combination of the companies’ private banking businesses, there is a high degree of crossover between the firms’ retail fund ranges, as well as its sales and back office staff.

The deal is set to push Schroders’ total assets under management above £250bn.

But head of equities Peter Harrison and co-heads of fixed income Karl Dasher and Philippe Lespinard face a dilemma as there is significant crossover between the two firms’ fund ranges.

Speaking to Investment Adviser shortly after the deal was announced in March, Robin Stoakley, managing director of UK intermediary at Schroders, said there would be fund mergers but promised there would be “minimum disruption” to investors. Cazenove’s 32 funds are set to be rebranded following completion of the takeover.

Cazenove’s fund range includes Julie Dean’s top-decile £1.2bn UK Opportunities fund, Chris Rice’s £951m European fund and Marcus Brookes’ top-performing multi-manager range - all areas in which Schroders already has products. Both companies also have products in the IMA Corporate Bond and IMA Strategic Bond sectors.

Speaking in March Mr Stoakley said Mr Harrison was “very aware” of the Cazenove equity managers’ business cycle investing approach and promised the deal would be handled “sensitively”.